Latest from Amtrak on Money for FY 2006

[jeaton]

The following is from the UTU web site:


Amtrak chief issues remarks on new fiscal year
The following message from Amtrak President David L. Gunn to Amtrak employees was issued on Monday, Oct. 3, 2005:
Dear Co-workers:

The new fiscal year began Saturday, Oct. 1 and brings with it new challenges to continue to operate within our budget.

The board of directors has approved a tight, but achievable budget for FY '06. It requires us to improve our passenger service, operate efficiently and make the most of our resources.

We have concluded FY '05 having served more than 25 million passengers, slightly higher than last year. This is a remarkable achievement given the brake problems that sidelined Acela Express in April and through most of the summer. Hurricanes Katrina and Rita also meant a loss of ridership for us. Hopefully, we will be getting the City of New Orleans and the Crescent up and running to and from New Orleans this month.

In FY '05, our operating subsidy budget -- the amount of federal money we used to subsidize operations -- was $570 million. In FY '06, that amount is being reduced to $540 million. In light of the inflationary pressures on our budget, especially with rising fuel, health care and other costs, this will be difficult, but doable.

We also depend on the federal grant to fund our entire capital budget, which for FY '06 is $562 million. The grant also provides us with nearly $280 million to pay down our debt and about $70 million for working capital. That adds up to $1.45 billion -- which is what the Senate appropriators have voted as our federal funding.

Because the House and Senate have yet to come to an agreement on the entire Transportation funding bill, which contains the Amtrak federal grant, we are now operating on a continuing resolution, or CR -- as in past years. This CR continues our funding for a short while. It is both temporary and less than what we will need in the year ahead, but it will enable us to continue our operations and capital projects for the fall.

We will continue to monitor our expenses and revenue very closely in the year ahead and make adjustments as may be needed. As you already know, one of the first adjustments we are making is a fare increase to be implemented on most trains starting tomorrow. It is not a large increase -- $3 on the average fare nationally and about $4 for the average fare in the NEC -- but it will help us keep pace with inflationary pressures.

Also, for the roughly 2,000 SmartPass monthly passengers in the NEC, we are modifying our plans to raise fares and will now do so in two stages to allow passengers to adjust to the increases. The 70-percent discount (based on 18 monthly roundtrips) will be replaced by a 60-percent discount on Oct. 16 and a 50-percent discount in February 2006. Even at 50-percent off the fare of a regular ticket, this is the largest discount that any railroad offers passengers for a monthly ticket.

As we close the books on FY '05 and move into this new fiscal year, please accept my thanks for the hard work and dedication that so many of you have demonstrated in recent months. We have recovered well from the Acela troubles (its on-time performance for September was 89), the hurricanes that suspended our service to the Gulf Coast and many other challenges. I look forward to traveling around the country this month for the President's Service and Safety Awards, meeting with you and honoring the service that you offer our passengers every day.

Sincerely,

David L. Gunn

October 4, 2005

[chad thomas]

Well, It looks like Amtrak will be around for another year.